Price Pfister Loss Blamed on Bonus for Top Staffers

Price Pfister reported a loss of $13.6 million, or $1.26 a share, for the third quarter ended Sept. 30, contrasted with a profit of $1.6 million, or 16 cents a share, a year earlier. Revenue, however, climbed 20% to $29.9 million for the quarter, contrasted with $24.9 million in the comparable period last year.

The Pacoima company, one of the country’s largest faucet makers, blamed its loss on a one-time bonus of $15.4 million paid to seven of the company’s top executives. The compensation was paid out in 1 million shares of Price Pfister stock.

The payment plan was drawn up in 1983 when a group of private investors bought Price Pfister from an investment banking firm. To retain key executives, the investors promised them a share of the company when Price Pfister went public. Price Pfister had its initial public offering of stock in August.

“These guys were extremely important executives and the future profitability of this company rested on them,” said David Rousso, Pfister’s chief financial officer.

Rousso and two other investors put 900,000 of their shares into the pay-out plan, which required the company to issue 100,000 more shares.

For the nine months ended Sept. 30, Price Pfister lost $11 million, or $1.07 a share, on revenue of $85.3 million. A year earlier, the company made $4.6 million, or 47 cents a share, on revenue of $73.7 million.